In economics, an agent is an actor (more specifically, a decision maker) in a model of some aspect of the economy. Typically, every agent makes decisions by solving a well- or ill-defined optimization or choice problem.
The term agent is also used in relation to principal–agent models; in this case, it refers specifically to someone delegated to act on behalf of a principal.[3]
In agent-based computational economics, corresponding agents are "computational objects modeled as interacting according to rules" over space and time, not real people. The rules are formulated to model behavior and social interactions based on stipulated incentives and information.[4] The concept of an agent may be broadly interpreted to be any persistent individual, social, biological, or physical entity interacting with other such entities in the context of a dynamic multi-agent economic system.
An economic model in which all agents of a given type (such as all consumers, or all firms) are assumed to be exactly identical is called a representative agent model. A model which recognizes differences among agents is called a heterogeneous agent model. Economists often use representative agent models when they want to describe the economy in the simplest terms possible. In contrast, they may be obliged to use heterogeneous agent models when differences among agents are directly relevant for the question at hand.[5] For example, considering heterogeneity in age is likely to be necessary in a model used to study the economic effects of pensions;[6] considering heterogeneity in wealth is likely to be necessary in a model used to study precautionary saving[7] or redistributive taxation.[8]
^Lucas, Robert, Jr. (1980). "Equilibrium in a pure currency economy". Economic Inquiry. 18 (2): 203–220. doi:10.1111/j.1465-7295.1980.tb00570.x.
^Fuerst, Timothy S. (1992). "Liquidity, loanable funds, and real activity". Journal of Monetary Economics. 29 (1): 3–24. doi:10.1016/0304-3932(92)90021-S.
^Ríos-Rull, José-Víctor (1995). "Models with Heterogeneous Agents". In Cooley, T. (ed.). Frontiers of Business Cycle Theory. Princeton University Press. ISBN978-0-691-04323-4.
^Altig, David; Auerbach, Alan; Kotlikoff, Laurence; Smetters, Kent; Walliser, Jan (2001). "Simulating Fundamental Tax Reform in the United States". American Economic Review. 91 (3): 574–595. doi:10.1257/aer.91.3.574. JSTOR 2677880.
^Carroll, Christopher (1997). "Buffer-Stock Saving and the Life Cycle/Permanent Income Hypothesis" (PDF). Quarterly Journal of Economics. 112 (1): 1–55. doi:10.1162/003355397555109. S2CID 14047708.
^Bénabou, Roland (2002). "Tax and Education Policy in a Heterogeneous-Agent Economy: What Levels of Redistribution Maximize Growth and Efficiency?" (PDF). Econometrica. 70 (2): 481–517. doi:10.1111/1468-0262.00293.
Further reading
Hartley, James E. (1997). "Retrospectives: The Origins of the Representative Agent". Journal of Economic Perspectives. 10 (2): 169–177. doi:10.1257/jep.10.2.169. JSTOR 2138488. S2CID 154459239.
Kirman, Alan P. (1992). "Whom or What Does the Representative Individual Represent?". Journal of Economic Perspectives. 6 (2): 117–136. doi:10.1257/jep.6.2.117. JSTOR 2138411.
January 30, 2023
agent, economics, economics, agent, actor, more, specifically, decision, maker, model, some, aspect, economy, typically, every, agent, makes, decisions, solving, well, defined, optimization, choice, problem, example, buyers, consumers, sellers, producers, comm. In economics an agent is an actor more specifically a decision maker in a model of some aspect of the economy Typically every agent makes decisions by solving a well or ill defined optimization or choice problem For example buyers consumers and sellers producers are two common types of agents in partial equilibrium models of a single market Macroeconomic models especially dynamic stochastic general equilibrium models that are explicitly based on microfoundations often distinguish households firms and governments or central banks as the main types of agents in the economy Each of these agents may play multiple roles in the economy households for example might act as consumers as workers and as voters in the model Some macroeconomic models distinguish even more types of agents such as workers and shoppers 1 or commercial banks 2 The term agent is also used in relation to principal agent models in this case it refers specifically to someone delegated to act on behalf of a principal 3 In agent based computational economics corresponding agents are computational objects modeled as interacting according to rules over space and time not real people The rules are formulated to model behavior and social interactions based on stipulated incentives and information 4 The concept of an agent may be broadly interpreted to be any persistent individual social biological or physical entity interacting with other such entities in the context of a dynamic multi agent economic system Contents 1 Representative vs heterogenous agents 2 See also 3 References 4 Further readingRepresentative vs heterogenous agents EditAn economic model in which all agents of a given type such as all consumers or all firms are assumed to be exactly identical is called a representative agent model A model which recognizes differences among agents is called a heterogeneous agent model Economists often use representative agent models when they want to describe the economy in the simplest terms possible In contrast they may be obliged to use heterogeneous agent models when differences among agents are directly relevant for the question at hand 5 For example considering heterogeneity in age is likely to be necessary in a model used to study the economic effects of pensions 6 considering heterogeneity in wealth is likely to be necessary in a model used to study precautionary saving 7 or redistributive taxation 8 See also EditAgency law Demand set Homo economicus Market consumerReferences Edit Lucas Robert Jr 1980 Equilibrium in a pure currency economy Economic Inquiry 18 2 203 220 doi 10 1111 j 1465 7295 1980 tb00570 x Fuerst Timothy S 1992 Liquidity loanable funds and real activity Journal of Monetary Economics 29 1 3 24 doi 10 1016 0304 3932 92 90021 S Stiglitz Joseph E 1987 Principal and Agent The New Palgrave A Dictionary of Economics Vol 3 pp 966 971 Page Scott E 2008 Agent based models The New Palgrave Dictionary of Economics 2nd ed Rios Rull Jose Victor 1995 Models with Heterogeneous Agents In Cooley T ed Frontiers of Business Cycle Theory Princeton University Press ISBN 978 0 691 04323 4 Altig David Auerbach Alan Kotlikoff Laurence Smetters Kent Walliser Jan 2001 Simulating Fundamental Tax Reform in the United States American Economic Review 91 3 574 595 doi 10 1257 aer 91 3 574 JSTOR 2677880 Carroll Christopher 1997 Buffer Stock Saving and the Life Cycle Permanent Income Hypothesis PDF Quarterly Journal of Economics 112 1 1 55 doi 10 1162 003355397555109 S2CID 14047708 Benabou Roland 2002 Tax and Education Policy in a Heterogeneous Agent Economy What Levels of Redistribution Maximize Growth and Efficiency PDF Econometrica 70 2 481 517 doi 10 1111 1468 0262 00293 Further reading EditHartley James E 1997 Retrospectives The Origins of the Representative Agent Journal of Economic Perspectives 10 2 169 177 doi 10 1257 jep 10 2 169 JSTOR 2138488 S2CID 154459239 Kirman Alan P 1992 Whom or What Does the Representative Individual Represent Journal of Economic Perspectives 6 2 117 136 doi 10 1257 jep 6 2 117 JSTOR 2138411 Retrieved from https en wikipedia org w index php title Agent economics amp oldid 1133891525, wikipedia, wiki, book, books, library,
